The Green New Deal is the big new thing among progressive Democrats. Until today, it has been little more than four words (much like Medicare for All, which tried to describe that big new thing in three words). Today, Rep. Alexandria Ocasio-Cortez (D-NY) and Sen Ed Markey (D-MA) introduced a 14-page resolution that begins to describe their vision of the GND. It is…big. Really big.
The resolution starts by enumerating the authors’ concerns about climate change: warning of the dire consequences if the earth continues to warm and the dangers of increased economic inequality. But it quickly takes a turn and, by the end, becomes an ambitious manifesto demanding—among many other things-- a massive infrastructure initiative, a guaranteed job with a “family-sustaining wage,” and universal access to high-quality health care, affordable housing, economic security, high-quality education, and healthy food.
It also calls for increased government support for family farming, economic development in vulnerable communities, research and development, and environmental cleanup. And it would meet the goals of 100 percent renewable power production and no net increase in greenhouse gas emissions. All of this would occur through a 10-year “national mobilization.”
Because this is only a framework (not unlike some early versions of the Tax Cuts and Jobs Act), it leaves out key details about how any of these ambitious goals would be accomplished or how they would be funded. But the cost would be staggering. Bigger, perhaps, than anything the US has undertaken since World War II.
In an NPR Morning Edition interview, Ocasio-Cortez was unfazed by the cost. Yes, she acknowledged, the GND would be expensive and require lots of government spending. But she insisted there is no need to worry about its long-term effects on the already-massive budget deficit because this initiative would pay for itself through economic growth.
While her prediction echoed precisely the claim by President Trump and Hill Republicans that the 2017 TCJA would pay for itself through growth, she made her prediction without apparent irony. Unlike taxes, she insisted, her new spending really would pay for itself through growth. She could prove it.
I suspect that some of her ideas—especially incentives for new technology and jobs—would generate some growth. But many of the ideas—while well-intentioned—could well slow the economy. For instance, imposing environmental or labor mandates on domestic employers may drive many of these new jobs overseas. Without vastly more details it is impossible to even guess at the net economic effects of it all.
The GND is big and bold, and many Democrats see it as a valuable antidote to what they believe has been decades of policy passivity. But the resolution’s ambitious promises will add trillions of dollars to the nation’s debt. And that itself could slow the economy. Its sponsors eventually will have to tell us how they will pay for it. Relying on a promise of economic growth is no more a credible for them than it was for the supporters of the TCJA.
